[Federal Register Volume 63, Number 133 (Monday, July 13, 1998)]
[Notices]
[Pages 37539-37543]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-18603]


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DEPARTMENT OF COMMERCE

International Trade Administration
[C-427-815, C-475-825, and C-580-835]


Notice of Initiation of Countervailing Duty Investigations: 
Stainless Steel Sheet and Strip in Coils From France, Italy, and the 
Republic of Korea

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce

EFFECTIVE DATE: July 13, 1998.

FOR FURTHER INFORMATION CONTACT: Marian Wells (France), at (202) 482-
6309; Vince Kane (Italy), at (202) 482-2815; and Robert Copyak (Korea), 
at (202) 482-2209, Import Administration, U.S. Department of Commerce, 
Room 1870, 14th Street and Constitution Avenue, N.W., Washington, D.C. 
20230.

Initiation of Investigations

The Applicable Statute and Regulations

    Unless otherwise indicated, all citations to the statute are 
references to the provisions effective January 1, 1995, the effective 
date of the amendments made to the Tariff Act of 1930 (the Act) by the 
Uruguay Round Agreements Act (URAA). In addition, unless otherwise 
indicated, all citations to the Department's regulations are references 
to the provisions codified at 19 CFR Part 351, 62 FR 27296, May 19, 
1997.

The Petition

    On June 10, 1998, the Department of Commerce (the Department) 
received petitions filed in proper form by or on behalf of Allegheny 
Ludlum Corporation, Armco Inc., J&L Specialty Steel, Inc., Washington 
Steel Division of Bethlehem Steel Corporation, United Steel Workers of 
America, AFL-CIO/CLC, Butler Armco Independent Union, and Zanesville 
Armco Independent Organization, Inc. (the petitioners). J&L Specialty 
Steel, Inc. is not a petitioner for the countervailing duty 
investigation involving France. Supplements to the petitions were filed 
on June 19, 22, 24, and 26, 1998.
    In accordance with section 702(b)(1) of the Act, petitioners allege 
that manufacturers, producers, or exporters of the subject merchandise 
in France, Italy, and Korea receive countervailable subsidies within 
the meaning of section 701 of the Act.
    The petitioners state that they have standing to file the petition 
because they are interested parties, as defined under sections 
771(9)(c) and (d) of the Act.

Scope of the Investigations

    For purposes of these investigations, the products covered are 
certain

[[Page 37540]]

stainless steel sheet and strip in coils. Stainless steel is an alloy 
steel containing, by weight, 1.2 percent or less of carbon and 10.5 
percent or more of chromium, with or without other elements. The 
subject sheet and strip is a flat-rolled product in coils that is 
greater than 9.5 mm in width and less than 4.75 mm in thickness, and 
that is annealed or otherwise heat treated and pickled or otherwise 
descaled. The subject sheet and strip may also be further processed 
(e.g., cold-rolled, polished, aluminized, coated, etc.) provided that 
it maintains the specific dimensions of sheet and strip following such 
processing.
    The merchandise subject to this investigation is classified in the 
Harmonized Tariff Schedule of the United States (``HTSUS'') at 
subheadings: 7219.13.00.30, 7219.13.00.50, 7219.13.00.70, 
7219.13.00.80, 7219.14.00.30, 7219.14.00.65, 7219.14.00.90, 
7219.32.00.05, 7219.32.00.20, 7219.32.00.25, 7219.32.00.35, 
7219.32.00.36, 7219.32.00.38, 7219.32.00.42, 7219.32.00.44, 
7219.33.00.05, 7219.33.00.20, 7219.33.00.25, 7219.33.00.35, 
7219.33.00.36, 7219.33.00.38, 7219.33.00.42, 7219.33.00.44, 
7219.34.00.05, 7219.34.00.20, 7219.34.00.25, 7219.34.00.30, 
7219.34.00.35, 7219.35.00.05, 7219.35.00.15, 7219.35.00.30, 
7219.35.00.35, 7219.90.00.10, 7219.90.00.20, 7219.90.00.25, 
7219.90.00.60, 7219.90.00.80, 7220.12.10.00, 7220.12.50.00, 
7220.20.10.10, 7220.20.10.15, 7220.20.10.60, 7220.20.10.80, 
7220.20.60.05, 7220.20.60.10, 7220.20.60.15, 7220.20.60.60, 
7220.20.60.80, 7220.20.70.05, 7220.20.70.10, 7220.20.70.15, 
7220.20.70.60, 7220.20.70.80, 7220.20.80.00, 7220.20.90.30, 
7220.20.90.60, 7220.90.00.10, 7220.90.00.15, 7220.90.00.60, and 
7220.90.00.80. Although the HTSUS subheadings are provided for 
convenience and Customs purposes, the written description of the 
merchandise under investigation is dispositive.
    Excluded from the scope of this petition are the following: (1) 
Sheet and strip that is not annealed or otherwise heat treated and 
pickled or otherwise descaled, (2) sheet and strip that is cut to 
length, (3) plate (i.e., flat-rolled stainless steel products of a 
thickness of 4.75 mm or more), (4) flat wire, and (5) razor blade 
steel. Razor blade steel is a flat-rolled product of stainless steel, 
not further worked than cold-rolled (cold-reduced), in coils, of a 
width of 9.5 to 23 mm and a thickness of 0.266 mm or less, containing 
by weight 12.5 to 14.5 percent chromium, and certified at the time of 
entry to be used in the manufacture of razor blades. See Chapter 72 of 
the HTSUS, ``Additional U.S. and Note'' 1(d).
    During our review of the petitions, we discussed scope with the 
petitioners to insure that the scope in the petitions accurately 
reflect the product for which they are seeking relief. Moreover, as 
discussed in the preamble to the new regulations (62 FR 27323), we are 
setting aside a period for parties to raise issues regarding product 
coverage. The Department encourages all parties to submit such comments 
by July 20, 1998. Comments should be addressed to Import 
Administration's Central Records Unit at Room 1870, U.S. Department of 
Commerce, 14th Street and Constitution Avenue, N.W., Washington, D.C. 
20230. The period of scope consultations is intended to provide the 
Department with ample opportunity to consider all comments and consult 
with parties prior to the issuance of our preliminary determinations.

Consultations

    Pursuant to section 702(b)(4)(A)(ii) of the Act, the Department 
invited representatives of the relevant foreign governments for 
consultations with respect to the petitions filed. On June 23, 1998, 
the Department held consultations with representatives of the 
Government of France (GOF). On June 26, 1998, consultations were held 
with representatives of the Government of Italy (GOI) and the European 
Commission (EC). On June 25, 1998, the GOF, and on June 29, 1998, the 
GOI and the EC filed submissions regarding the issues raised during the 
consultations. See the June 23, 1998 and June 30, 1998, memoranda to 
the file regarding the consultations with the GOF and the GOI, 
respectively (public documents on file in the Central Records Unit of 
the Department of Commerce, Room B-099).

Determination of Industry Support for the Petition

    Section 702(b)(1) of the Act requires that a petition be filed on 
behalf of the domestic industry. Section 702(c)(4)(A) of the Act 
provides that a petition meets this requirement if the domestic 
producers or workers who support the petition account for: (1) At least 
25 percent of the total production of the domestic like product; and 
(2) more than 50 percent of the production of the domestic like product 
produced by that portion of the industry expressing support for, or 
opposition to, the petition.
    Section 771(4)(A) of the Act defines the ``industry'' as the 
producers of a domestic like product. Thus, to determine whether the 
petition has the requisite industry support, the statute directs the 
Department to look to producers and workers who account for production 
of the domestic like product. The International Trade Commission (ITC), 
which is responsible for determining whether ``the domestic industry'' 
has been injured, must also determine what constitutes a domestic like 
product in order to define the industry. While both the Department and 
the ITC must apply the same statutory definition of domestic like 
product (section 771(10) of the Act), they do so for different purposes 
and pursuant to separate and distinct authority. In addition, the 
Department's determination is subject to limitations of time and 
information. Although this may result in different definitions of the 
like product, such differences do not render the decision of either 
agency contrary to the law. <SUP>1</SUP>
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    \1\ See Algoma Steel Corp., Ltd. v. United States, 688 F. Supp. 
639, 642-44 (CIT 1988); High Information Content Flat Panel Displays 
and Display Glass Therefor from Japan: Final Determination; 
Rescission of Investigation and Partial Dismissal of Petition, 56 FR 
32376, 32380-81 (July 16, 1991).
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    Section 771(10) of the Act defines domestic like product as ``a 
product that is like, or in the absence of like, most similar in 
characteristics and uses with, the article subject to an investigation 
under this title.'' Thus, the reference point from which the domestic 
like product analysis begins is ``the article subject to an 
investigation,'' i.e., the class or kind of merchandise to be 
investigated, which normally will be the scope as defined in the 
petition.
    The domestic like product referred to in the petitions is the 
single domestic like product defined in the ``Scope of Investigation'' 
section, above. The Department has no basis on the record to find the 
petitions' definition of the domestic like product to be inaccurate. 
The Department therefore, has adopted the domestic like product 
definition set forth in the petitions. In this case the Department has 
determined that the petitions and supplemental information contained 
adequate evidence of sufficient industry support, and, therefore, 
polling is unnecessary (see Memorandum to the File, regarding Industry 
Support, dated June 30, 1998). For France, Italy, and Korea, 
petitioners established industry support representing over 50 percent 
of total production of the domestic like product.

[[Page 37541]]

    Additionally, no person who would qualify as an interested party 
pursuant to section 771(A)(C)(D)(E) or (F) has expressed opposition on 
the record to the petition. Therefore, to the best of the Department's 
knowledge, the producers who support this petition account for 100 
percent of the production of the domestic like product produced by the 
portion of the industry expressing an opinion regarding the petitions. 
Accordingly, the Department determines that these petitions are filed 
on behalf of the domestic industry within the meaning of section 
702(b)(1) of the Act.

Injury Test

    Because France, Italy, and Korea are ``Subsidies Agreement 
Countries'' within the meaning of section 701(b) of the Act, section 
701(a)(2) applies to these investigations. Accordingly, the U.S. 
International Trade Commission (ITC) must determine whether imports of 
the subject merchandise from these countries materially injure, or 
threaten material injury to, a U.S. industry.

Allegations and Evidence of Material Injury and Causation

    The petitions allege that the U.S. industry producing the domestic 
like product is being materially injured, and is threatened with 
material injury, by reason of the subsidized individual and cumulated 
imports of the subject merchandise from France, Italy, and Korea. 
Petitioners explained that the industry's injured condition is evident 
in the declining trends in net operating profits, net sales volumes, 
profit to sales ratios, and capacity utilization. The allegations of 
injury and causation are supported by relevant evidence including U.S. 
Customs import data, lost sales, and pricing information. The 
Department assessed the allegations and supporting evidence regarding 
material injury and causation, and determined that these allegations 
are sufficiently supported by accurate and adequate evidence and meet 
the statutory requirements for initiation (see Attachment 1 to 
Initiation Checklists dated June 30, 1998, entitled Analysis of 
Allegations and Evidence of Material Injury and Causation).

Allegations of Subsidies

    Section 702(b) of the Act requires the Department to initiate a 
countervailing duty proceeding whenever an interested party files a 
petition, on behalf of an industry, that (1) alleges the elements 
necessary for an imposition of a duty under section 701(a), and (2) is 
accompanied by information reasonably available to petitioners 
supporting the allegations.

Initiation of Countervailing Duty Investigations

    The Department has examined the petitions on stainless steel sheet 
and strip in coils (sheet and strip) from France, Italy, and Korea and 
found that they comply with the requirements of section 702(b) of the 
Act. Therefore, in accordance with section 702(b) of the Act, we are 
initiating countervailing duty investigations to determine whether 
manufacturers, producers, or exporters of sheet and strip from these 
countries receive subsidies. See the June 30, 1998, memoranda to the 
file regarding the initiation of these investigations (public documents 
on file in the Central Records Unit of the Department of Commerce, Room 
B-099).

A. France

    We are including in our investigation the following programs 
alleged in the petition to have provided subsidies to producers and 
exporters of the subject merchandise in France:
Government of France Programs
1. Purchase of Power Plant
2. Forgiveness of Shareholders' Loans in 1994 and 1995
3. Provision of Export Financing Under Natexis Banque Programs
4. Related Party Grants Received from 1992-95
5. Related Party Loans
6. DATAR Programs
    a. Regional Development Grants (PATs)
    b. Work/Training Contracts and Internships
    c. DATAR 50 Percent Taxing Scheme
    d. Tax Exemption for Industrial Expansion
    e. Tax Credit for Companies Located in Special Investment Zone
    f. Tax Credits for Research
7. GOF Guarantees
8. Long-Term Loans from CFDI
9. Steel Intervention Fund (FIS)
10. Loans with Special Characteristics (PACS): Equity Infusion
11. Shareholders' Advances
12. Investment/Operating Subsidies
13. Ugine 1991 Grant
European Commission Programs
1. Myosotis
2. Electric Arc Furnaces
3. Resider II Program
4. Youthstart
5. ECSC Article 54 Loans
6. ECSC Article 56(2)(b) Redeployment Aid
7. European Social Fund Grants (ESF)
    8. European Regional Development Fund Grants (ERDF)

    We are not including in our investigation the following programs 
alleged to be benefitting producers and exporters of the subject 
merchandise in France:
1. Upstream Subsidies From Sollac
    Petitioners allege that the production of stainless steel sheet and 
strip in coils received upstream subsidies within the meaning of 
section 771A of the Act through the provision of subsidies to a related 
company, Sollac, which supplied hot-rolling services for Ugine during 
the period 1983-1997. Sollac is 95 percent owned by Usinor. Referring 
to section 355.45 of the Countervailing Duties; Notice of Proposed 
Rulemaking, 54 FR 23368 (May 31, 1989) (``1989 Proposed Regulations''), 
petitioners state that an investigation of an upstream subsidy 
allegation is warranted because there is a reasonable basis to believe 
or suspect that: (1) Domestic subsidies have been provided with respect 
to the input product; (2) a competitive benefit has been bestowed; and 
(3) the subsidies have a significant effect on the cost of producing 
the subject merchandise. In particular, in support of its allegation 
that domestic subsidies have been provided with respect to the input 
product, petitioners assert that all untied, countervailable subsidies 
bestowed on Usinor in 1983 or later that were found countervailable in 
Final Affirmative Countervailing Duty Determinations: Certain Steel 
Products from France, 58 FR 37304 ((July 9, 1993)) (Certain Steel from 
France (1993)), along with the additional untied post-1991 subsidies 
alleged in this case, continue to benefit Sollac during the POI.
    The Department's methodology with respect to calculating the 
subsidy rate for untied, domestic subsidies is to divide the total 
amount of the benefit by the total sales of the recipient company 
(i.e., Usinor). Therefore, the resulting rate captures the full level 
of subsidization on the subject merchandise, including any 
countervailable subsidies bestowed upon any inputs or processes 
supplied by Usinor companies to the production of the subject 
merchandise. To consider the same benefit as both an upstream subsidy 
and as a subsidy to the manufacturer of the finished product would 
result in double-counting the benefit. On this basis, we find that the 
initiation of an upstream subsidy investigation is not warranted in 
this case.

[[Page 37542]]

2. Long-Term Loans From FDES
    The Law of July 13, 1978 created participative loans that were 
issued by Fonds de Developpement Economique et Social (FDES). In 1990, 
FDES loans obtained by Usinor and Sacilor were consolidated into 
multiple long-term loans which the Department treated as new loans in 
Certain Steel from France (1993) and Final Affirmative Countervailing 
Duty Determination: Certain Hot Rolled Lead and Bismuth Carbon Steel 
Products from France, 58 FR 6221 (January 27, 1993) ((Lead and 
Bismuth)). Using the private bond interest rate reported in the OECD 
Financial Statistics as the benchmark in Lead and Bismuth, the 
Department found these loans to be countervailable to the extent that 
the interest rates were more favorable than the benchmark. In Certain 
Steel from France (1993), however, a different benchmark was used, and 
the same loans were found not countervailable because there was no 
benefit. Despite the determination of Certain Steel from France (1993), 
petitioners allege that the contradictory stance taken by the 
Department in Lead and Bismuth gives reason to investigate the loans to 
determine the extent to which these loans continued to bestow 
countervailable benefits on the production of the subject merchandise 
during the POI of this case.
    Given that Certain Steel from France (1993) is the Department's 
most recent determination with respect to the long-term loans provided 
by the FDES, we find that there is no reason to revisit our decision 
that the FDES loans are not countervailable. Petitioners have provided 
no new evidence to indicate that Usinor has obtained any new loans or 
to prompt a reexamination of the loans and the benchmark used in our 
previous investigation. Accordingly, we are not including this program 
in our investigation.
3. Placement of Usinor Shares With ``Stable Shareholders''
    As part of its privatization plan in 1995, the GOF placed 14.79 
percent of Usinor's capital with ``Stable Shareholders.'' The ``Stable 
Shareholders,'' who consisted of both government-owned entities and 
private companies, purchased their shares at a premium and were 
required to adhere to the Protocole. The Protocole imposed restrictions 
on the resale of shares held by the ``Stable Shareholders'' thereby 
preventing a takeover of the privatized company. Petitioners allege 
that by placing these illiquid shares with the ``Stable Shareholders'' 
the GOF created a built-in defense against takeovers and other 
instability, thereby providing a secure investment environment for 
private investors purchasing the remaining shares. Petitioners assert 
that without the implicit guarantee represented by these ``Stable 
Shareholders,'' no private investment would have taken place. 
Therefore, petitioners allege that the GOF's placement of shares with 
``Stable Shareholders'' provided a benefit in the form of a ``potential 
direct transfer of funds'' to Usinor which should be measured by the 
total amount of the private investment.
    We are not including this alleged subsidy in our investigation 
because we do not accept petitioners' argument that the placement of 
Usinor's shares with ``Stable Shareholders'' amounts to an implicit 
guarantee. Instead, the placement of the shares was simply part of the 
GOF's privatization plan for Usinor. As petitioners point out, the 
placement of shares with ``Stable Shareholders'' was designed to 
prevent a takeover of the company. Thus, the GOF was seeking to prevent 
certain purchases of Usinor's shares, not to ensure the sale of those 
shares.
4. Credit Lyonnais 1991 Investment
    In 1991, Credit Lyonnais purchased a 20 percent share of Usinor 
Sacilor. In Certain Steel from France (1993) and Lead and Bismuth from 
France, the Department determined that Usinor Sacilor was equityworthy 
in 1991 and found the investment not countervailable. Petitioners 
allege that they have uncovered new evidence which establishes that the 
GOF's equity investment bestowed a countervailable benefit and 
constitutes additional factual evidence sufficient to prompt a 
reexamination of the investment.
    Petitioners assert that the new evidence, presented in the 1995 
French Audit Office Report (``Audit Report''), indicates that the 
shares purchased by the bank were immobile and non-remunerative. As 
such, petitioners allege that the Credit Lyonnais investment lacked the 
defining characteristics of an equity investment (i.e., a claim on the 
company's earnings and based on an expectation of a reasonable return) 
and, thus, constituted a grant rather than equity. See General Issues 
Appendix, appended to Final Affirmative Countervailing Duty 
Determination; Certain Steel Products from Austria, 58 FR 37217, 37239 
(July 9, 1993). Other evidence that petitioners present include the 
1994 French Parliamentary investigation and report (``French 
Parliamentary Report'') which state that Credit Lyonnais ``took the 
place of the government'' to recapitalize and support Usinor. The Audit 
Report also criticizes the investment as inappropriate and ultimately 
very costly to Credit Lyonnais.
    A close examination of the Audit Report reveals otherwise. First, 
we find that the Audit Report's conclusion that the investment in 
companies such as Usinor were not ``mobilizable'' was drawn from the 
policy implications, rather than actual restrictions on the shares 
themselves. The Audit Report states: ``Securities of national 
enterprises were involved. To sell them * * * would have led to 
denationalization.'' In other words, Credit Lyonnais could not sell the 
shares without the GOF's explicit policy decision to privatize the 
company. The mere existence of a government policy to retain the 
control of a state-owned company, however, does not transform the 
investment into a grant.
    With respect to the alleged ``unremunerative'' nature of the 
shares, we note that the Audit Report merely states that the stocks did 
not ``quickly produce any dividend.'' (Emphasis supplied). There is no 
indication that there were actual restrictions on the shares or that 
there were no returns on the investment.
    Finally, given that both the Audit Report and the French 
Parliamentary Report were issued ex post facto, we do not consider the 
statements regarding the ultimate cost of the investment to be 
relevant. As we stated in the General Issues Appendix, ``neither the 
benefit nor the equityworthiness determination should be reexamined 
post hoc since such information could not have been known to the 
investor at the time of the investment.'' 58 FR at 37239.
    Accordingly, we find that the evidence presented by petitioners is 
not sufficient for us to reinvestigate the 1991 investment by Credit 
Lyonnais. On this basis, we are not including this program in our 
investigation.

B. Italy

    In the course of preparing its CVD questionnaire response in the 
concurrent investigation of Stainless Steel Plate in Coils from Italy, 
the GOI has ascertained that AST has not applied for or received 
assistance under the following programs: Law 706/85 Grants for Capacity 
Reduction, Law 46/82 Assistance for Capacity Reduction, Law 193/84 
Early Retirement Assistance and Interest Grants, Law 394/81 Export 
Marketing Grants and Loans, Law 341/95 and Circolare 50175/95, European 
Regional Development Fund, Resider II Program (and Successor Programs), 
and Law 181 Worker Adjustment/Redevelopment Assistance. We are

[[Page 37543]]

including these programs in this investigation pending verification of 
the GOI's claim of non-use.
    We are including in our investigation the following programs 
alleged in the petition to have provided subsidies to producers and 
exporters of the subject merchandise in Italy:
Government of Italy Programs
1. Law 796/76: Exchange Rate Guarantee Program
1. Benefits Associated with the 1988-1990 Restructuring
2. Pre-Privatization Employment Benefits
3. Law 120/89 Recovery Plan for the Steel Industry
4. Law 181/89 Worker Adjustment/Redevelopment Assistance
5. Law 706/85 Grants for Capacity Reduction
6. Law 488/92 Aid to Depressed Areas
7. Law 46/82 Assistance for Capacity Reduction
8. Working Capital Grants to ILVA, S.p.A. (ILVA)
9. ILVA Restructuring and Liquidation Grant
10. 1994 Debt Payment Assistance by the Instituto per la Riscostruzione 
Industriale (IRI)
11. Loan to KAI for purchase of Acciai Speciali Terni S.p.A. (AST)
12. Debt Forgiveness: 1981 Restructuring Plan
13. Debt Forgiveness: Finsider-to-ILVA Restructuring
14. Debt Forgiveness: ILVA-to-AST Restructuring
15. Law 675/77
    a. Mortgage Loans
    b. Interest Contributions on IRI Loans
    c. Personnel Retraining Aid
    d. VAT Reductions
    e. Grants to Pay Interest on Bank Loans
17. Law 193/84
    a. Interest Payments
    b. Closure Assistance
    c. Early Retirement Benefits
18. Law 394/81 Export Marketing Grants and Loans
19. Equity Infusions from 1983 through 1992
20. Uncreditworthiness for 1983 through 1997

    Petitioners have additionally alleged that AST was uncreditworthy 
in the years when it allegedly received non-recurring subsidies. This 
allegation was supported by financial ratios for AST and its 
predecessor companies. Thus, for those years we will investigate the 
creditworthiness of AST and its predecessor companies.

21. Law 341/95 and Circolare 50175/95
22. Export Financing Under Law 227/77 and Remission of Taxes
European Commission Programs
1. EU Subsidy to AST to Construct a Mill
2. ECSC Article 54 Loans & Interest Rebates
3. ECSC Article 56 Conversion Loans, Interest Rebates & Redeployment 
Aid
4. European Social Fund
5. European Regional Development Fund
6. Resider II Program (and successor programs)
7. 1993 EU Funds

C. Korea

    We are including in our investigation the following programs 
alleged in the petition to have provided subsidies to producers and 
exporters of the subject merchandise in Korea:
Government of Korea Programs
1. Pre-1992 Government of Korea Direction of Credit
2. Post-1991 Government of Korea Direction of Credit
3. 1992 ``Emergency Loans'' to Sammi Steel Company
4. Financial Assistance in Conjunction with the 1997 Sammi Steel 
Company Bankruptcy
5. Tax Incentives for Highly-Advanced Technology Businesses
6. ``National Subsidy'' to Inchon
7. POSCO Purchase of Sammi Specialty Steel Division for More Than 
Adequate Remuneration
8. Provision of Electricity for Less Than Adequate Remuneration
9. Reserve for Investment
10. Kwangyang Bay Project
11. Export Facility Loans
12. Reserve for Export Loss Under the Tax Exemption and Reduction 
Control Act (TERCL)
13. Reserve for Overseas Market Development Under the Tax Exemption and 
Reduction Control Act (TERCL)
14. Unlimited Deduction of Overseas Entertainment Expenses
15. Short-Term Export Financing
16. Korean Export-Import Bank (EXIMBANK) Loans
17. Special Depreciation of Assets on Foreign Exchange Earnings
18. Export Insurance Rates Provided by the Korean Export Insurance 
Corporation
19. Excessive Duty Drawback
20. Uncreditworthiness for 1990 through 1997

    Petitioners have alleged that two Korean producers of the subject 
merchandise, Sammi Steel Company (Sammi) and Inchon Iron & Steel 
Company (Inchon), were uncreditworthy during the period 1990 through 
1997 and 1991 through 1997, respectively. For those respective years, 
petitioners have provided financial ratios for the two companies which 
indicate that the companies may be uncreditworthy for those respective 
periods. Thus, for those respective years, we will investigate whether 
the companies were uncreditworthy during the years in which petitioners 
have alleged non-recurring countervailable subsidies.
    Petitioners have also alleged that Sammi and Inchon were 
uncreditworthy from 1983 through 1997. We are not investigating 
creditworthiness in the years 1983 through 1989 for Sammi and for the 
years 1983 through 1990 for Inchon. Petitioners did not provide any 
information to indicate that the companies were uncreditworthy for 
those respective years.

Distribution of Copies of the Petition

    In accordance with section 702(b)(4)(A)(i) of the Act, copies of 
the public version of the petition have been provided to the 
representatives of France, Italy, and Korea. We will attempt to provide 
copies of the public version of the petition to all the exporters named 
in the petition, as provided for under section 351.203(c)(2) of the 
Department's regulations.

ITC Notification

    Pursuant to section 702(d) of the Act, we have notified the ITC of 
these initiations.

Preliminary Determination by the ITC

    The ITC will determine by July 27, 1998, whether there is a 
reasonable indication that an industry in the United States is 
materially injured, or is threatened with material injury, by reason of 
imports of stainless steel sheet and strip from France, Italy, and 
Korea. A negative ITC determination will, for any country, result in 
the investigation being terminated with respect to that country; 
otherwise, the investigations will proceed according to statutory and 
regulatory time limits.
    This notice is published pursuant to section 777(i) of the Act.

    Dated June 30, 1998.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.
[FR Doc. 98-18603 Filed 7-10-98; 8:45 am]
BILLING CODE 3510-DS-P